Serial Japanese investor, Toyota Tsusho, seems to be bringing diversity to its investment table this time. Barely two months after putting some funds into Samurai Africa Fund 2 (a fund run by Samurai Incubate Inc.), the company has made its first investment in an African insurtech startup, starting with AiCare Group, Inc. (“AiCare”), a provider of telematics insurance system for insurance companies in Kenya.
The investment which was made from Mobility 54 Investment SAS (“Mobility 54”) — a corporate venture capital subsidiary of Toyota Tsusho group established in October 2019 — was done through convertible notes.
Any car owner in Kenya is required to purchase auto insurance, and approximately 3 million cars are currently insured. For single and flat rates, insurance premium rates are usually calculated depending on the value of the car, regardless of the driver’s driving characteristics and activities.
Click here to find out more!
As a result, safe drivers are thought to pay comparatively higher premiums in comparison to their driving habits and crash danger. Furthermore, single and flat insurance rates are less effective at avoiding road collisions and do not serve as an opportunity for careful driving.
As a result, relative to most insurance policies, auto insurance has become a riskier option for insurance providers.
Some countries in Sub-Saharan Africa are facing similar problems. The customized motor insurance for each driver, which is supported by real-time data on the distance traveled by each car and the driving habits of each driver, is expected to change the African motor insurance market and, as a result, minimize traffic accidents.
Investment in AiCare is therefore rather strategic for Toyota Tsusho.
By accelerating the penetration of telematics insurance in the African insurance market, the investment in AiCare aims to provide higher quality insurance coverage to drivers.
Accordingly, the Toyota Tsusho Group will assist AiCare in deploying its telematics insurance scheme throughout Africa by using its extensive automotive network. Furthermore, telematics insurance has a lot of possible synergy with the linked networks that are likely to evolve across the continent in the next few years.
Read the original article here